Labor is more than 40% of the cost of your typical construction project. Maybe it’s a little less, or a lot more, depending on the kind of project we’re talking about, what kind of business you run, where the project is, current cost of materials — but we can agree that it’s a serious chunk of the budget. In fact, labor is probably the largest single cost category on your projects.
That means when it comes to protecting your margins, labor deserves real scrutiny and there are a couple of real risks. For one, you’ve got to defend against labor costs spiraling when field teams get hung up on unexpected issues. Maybe even more importantly, you need every hour to count.
Maximizing productivity in the field is perhaps the single most important thing a construction firm can do to make sure jobs are profitable.
Field Teams Rarely Hit Peak Productivity
The simple truth is that construction field teams rarely get the chance to open the throttle on site. Only about 4 in 10 working hours are spent on the tools. But it’s not their fault. We all know that construction workers are some of the most driven and hard-working people on the planet. So why does so little of their time go into productive activity on the jobsite?
Pretty simple: they get blocked by lack of complete and actionable design information (or access to it), design change, lack of approvals on submittals and change orders and the like, issuance of permits, notices to proceed — all of the critical, but too often grindingly slow, machinery of design and construction management. Layer on top of that waiting for available equipment, delivery of materials, and curveballs like hidden conditions, and you have a recipe for an unproductive field.
Frustrating as it may be, there’s reason for some real optimism and excitement around the magnitude of the opportunity for improvement. If the construction field operations of today are this blocked, imagine the potential productivity gains by removing even just a few of those blockers?
Effective Preconstruction Means Productive Operations
If there’s one investment that a construction firm can make to remove constraints on field productivity, it’s in a best-in-class preconstruction operation. Making sure the design is truly complete and actionable (whether that design is within your firm’s contract responsibility, or you’re simply holding other parties accountable to their responsibilities), and doing it before boots hit the ground in the field, is critical to the field being able to hit their stride.
One way to look at it, is like this: if there’s an issue with the design, it is going to get sorted out. There’s no way a design gets built until… well, until it’s build-able. The question is, are issues going to get sorted while crews are standing on the jobsite tapping their foot, as labor and general conditions costs burn a hole through the budget, and while progress slows to a crawl? Or, are issues going to get sorted out ahead of time, before you mobilize field resources, and while time is cheap?
The amount of rework that a job suffers is another good measure of how well thought out a design is. The State of Global Preconstruction Industry Report, issued by FMI in 2022, draws a clear connection between a robust preconstruction process and the reduction of rework on the job.
Sorting out the design ahead of time isn’t the only thing you can do to set the stage for a productive field. Procuring long lead materials means that they’ll be on the jobsite when they’re needed. Buying out the contract early ensures that everybody is on board and can start working together to coordinate a smooth operation. Creating detailed, phased logistical plans — especially where those plans involve road closures, interruption to services, or impact on neighboring properties — means that all stakeholders can get aligned and the job can run efficiently. Doing the resource planning to put the right workforce with the right equipment in the field at the right time means that crews can hit schedule targets because they actually have sufficient resources to do so.
Whether you consider these activities to be “preconstruction” or “operations” is kind of semantic — the point is, you want to do all of this stuff early, before it becomes a blocker to crews actively working in the field.
Efficient Construction Management Shows Up in the Field
Field productivity is the measure of great construction management. When construction management is working well, it means that all the project design documentation is current and accessible to everybody working on the job. It means that all parties are communicating and collaborating around a common, trusted source of information, and that nobody is in the dark. It means that submittals are reviewed and approved in a timely manner, so that they don’t start to control the critical path. It means that RFIs get answered clearly and quickly, and that change orders get resolved fast so that there’s always alignment on the scope of work. And of course, it means safe jobsites, quality work, and that everybody is getting paid fairly and timely. If any one of these things aren’t happening, field productivity suffers.
No matter how carefully you plan a job, there will be surprises, curve balls, and stuff that — despite all the due diligence in the world — nobody thought of. That’s part of the game. But, when the unexpected does happen, an effective construction management motion helps remove or resolve those blockers as quickly as possible, which means crews can deal with the issue and keep moving.
At the end of the day construction crews can and will produce high quality work at a blistering pace when they’re set up to do so. Crews thrive on that. It’s all the blockers not in their control that get in the way. But when only 4 in 10 hours are spent on the tools, that means there’s potential to double the productivity of your field operations — and then some.
Think about what that could do for your bottom line.